Orlen Lietuva delivers good financial results following restructuring

Friday, July 24, 2015

Orlen Lietuva benefits from restructuring and very favourable macroeconomic conditions. Production capacity utilisation reached 86 percent in the second quarter of 2015 (reaching 92 percent in June, which was the highest level since two years).

Further development of sales among others on markets of the Baltic States and Ukraine drove the Company to the net result of USD 145 million (EUR 133 million) for the first half of 2015, Orlen Lietuva said in a statement.

"All the efforts and commitment made to restructure the Company is followed with good financial results. Nevertheless we do not overestimate the influence of market conditions, that currently are extremely favourable for us. However we noted that our efforts to expend in the Baltic States market result with higher sales volumes. In the first half of 2015 Orlen Lietuva delivered 22 percent more volumes to Latvia compared to the same period in 2014. In Estonia in the same period our sales enlarged by 38 percent," said Ireneusz Fafara, CEO of Orlen Lietuva.

Orlen Lietuva, in the second quarter of 2015 noted an increase of all financial indicators (y/y). EBITDA LIFO reached USD 134 million (EUR 123 million) comparing to USD 0 million in the second quarter of 2014 (excluding impairment), net result amounted in USD 98 million (EUR 90 million) vs. USD -24m (EUR -22 million) (excluding impairment) in the second quarter of 2014.

Orlen Lietuva is the biggest Lithuanian company, exporter and tax payer. Since 2006, PKN Orlen has spent nearly USD 4 billion (EUR billion) on the acquisition and further investments in the Mazeikiai refinery. PKN Orlen has never distributed any of Orlen Lietuva profit as dividend, and has reinvested all financial resources available at the company in its development.

The Company permanently suffers from high logistical costs. Therefore PKN Orlen, as the only shareholder, undertook all accessible measure to restructure the Company and implement a strategy that enables Orlen Lietuva to adjust to market conditions: maximise the production and thus the economic effect whenever the market is favourable. And on the other hand introduced solutions could help to minimalise it, when the market is low.

PKN Orlen is a modern player on the fuel and power market, the largest company in Central and Eastern Europe, and the only Polish company listed among the prestigious Fortune 500. Furthermore, Oreln is the only company in the region to have been named The Most Ethical Company of 2014 by the US Ethisphere Institute.